Greater New York Mutual Insurance v. Axentiou

Order, Supreme Court, New York County (Beatrice Shainswit, J.), entered on or about September 24, 1992, which denied defendant-appellant’s motion to dismiss the complaint based on documentary evidence, or, alternatively, for summary judgment, unanimously affirmed, with costs. We agree with the IAS Court that Insurance Law § 2121 (a), "designed to relieve the insured from all risks stemming from a broker’s possible dishonesty or insolvency” (Bohlinger v Zanger, 306 NY 228, 237 [Fuld, J., dissenting]), does not afford the same protection to a broker, such as appellant, who, pursuant to an arrangement with a cobroker, forwards a premium payment to the cobroker who then fails to remit the premium to the insurer. And, although appellant’s documentary evidence does show that it paid the premium to codefendant-cobroker, nevertheless, appellant can be held liable for codefendant’s theft of premium if, as plaintiff claims, appellant and codefendants had entered into a joint venture to procure the policy in question. The existence of such a joint venture is, as the IAS Court held, an issue of fact more appropriately to be considered after joinder of issue. Concur— Murphy, P. J., Sullivan, Rosenberger, Ross and Asch, JJ.